Baker Steel Resources Trust : Polar Acquisition Limited / Polar Silver

BAKER STEEL RESOURCES TRUST LIMITED

(Incorporated in Guernsey with registered number 51576 under the provisions of The Companies (Guernsey) Law, 2008 as amended)

19 January 2017

Polar Acquisition Limited ('PAL')/ Polar Silver Resources Limited ('Polar Silver')

The Company is pleased to announce that it has successfully negotiated an agreement with Polymetal International plc (LSE, MOEX: POLY; ADR: AUCOY) ('Polymetal') for Polymetal to participate in the development of the Prognoz silver project with Polar Silver Resources Limited.

As announced in the December NAV statement, released today the reorganisation of the Polar Silver Group was completed in early December 2016. Following this reorganisation, the Company holds a 64% interest in PAL, which in turn owned 100% of Polar Silver prior to the Polymetal transaction. Polar Silver thus has a 50% indirect interest in the Prognozsilver project ('Prognoz'), which is located 444km north of Yakutsk in the Russian Federation .

Under the terms of the agreement, Polymetal will subscribe US$3 million in cash for a 10% interest in Polar Silver. Polymetal will also take on an obligation to undertake 25 km of diamond drilling, and complete a technical study, which will produce an externally audited JORC-compliant reserves estimate for the property by 31 March 2019. The capital expenditure required to perform the drilling and complete the technical study is budgeted at US$ 10 million per annum during the years 2017-2019.

Upon completion of the technical study and the reserve estimate, but no later than 31 March 2020, Polymetal will have an option to acquire the 90 per cent of the Polar Silver shares that it does not already own. The consideration for the exercise will depend among other things, on spot silver prices and the size of estimated reserves and be determined at the time of the option exercise. Should Polymetal decide not to exercise its option, the agreement will terminate with no further amounts to be paid or received by the parties.

This agreement between Polymetal and Polar Silver Resources not only provides the funding for the completion of the feasibility study on the Prognoz project but importantly introduces a well respected local partner in Russia, which has the technical capabilities to operate in the Prognoz environment as well as affording a route for the realisation of the investment for the Company.

This transaction was taken into account when valuing the Company's interest in PAL in the 30 December NAV.

Further details of the Company and its investments are available on the Company's websitewww.bakersteelresourcestrust.com

Enquiries:

Baker Steel Resources Trust Limited +44 20 7389 8237

Francis Johnstone
Trevor Steel

Numis Securities Limited +44 20 7260 1000

David Benda (corporate)

James Glass (sales)

The Net Asset Value ('NAV') figure stated is based on unaudited estimated valuations of the underlying investments and not necessarily based on observable inputs. Such estimates are not subject to any independent verification or other due diligence and may not comply with generally accepted accounting practices or other generally accepted valuation principles. In addition, some estimated valuations are based on the latest available information which may relate to some time before the date set out above.

Accordingly, no reliance should be placed on such estimated valuations and they should only be taken as an indicative guide. Other risk factors which may be relevant to the NAV figure is set out in the Company's Prospectus dated 26 January 2015.